
Enovis Reports Strong 3Q23 and Raises Full Year Outlook Based Upon Strong Hip/Knee Growth; Expects to Drive Synergies Accelerate Growth With LimaCorporate Deal
11-8-23 (by: Scott Gleason) Enovis has released its financial results for the third quarter with net sales reaching $418 million, signifying a 9% increase compared to the same period in 2022. Street estimates called for revenue of $415 million. Organic growth in the quarter was 6%. The quarter showcased robust growth in the Reconstructive segment, particularly in the US hip/knee category, where the company achieved double-digit growth, with an impressive 18% organic increase, ahead of peer growth rates such as Zimmer Biomet, Stryker, and Smith + Nephew.
The company’s Reconstructive segment was up 16% (10% organic) and Prevention and Recovery segment was up 5% (4% organic).
Management noted its recently announced definitive agreement to acquire LimaCorporate S.p.A. for an enterprise value of approximately €800 million which the company believes will accelerate its growth and enhance its margin profile through revenue and $40 million in cost synergies. The company also noted key capabilities of LimaCorporate such as expanding the company’s 3-D printing technology and customized patient solutions.
In terms of financial profitability, the company reported adjusted EBITDA of $65 million, equivalent to 15.7% of sales. This represents an impressive improvement of 80 basis points compared to the same period in the previous year. Adjusted earnings per diluted share were $0.56 versus consensus forecasts of $0.54.
The company raised its financial guidance for the year and now anticipates organic revenue growth of 7.4-7.6%, an increase from its previous expectation of 7-7.5%. Additionally, Enovis projects adjusted EBITDA to reach $264-$270 million, surpassing its earlier forecast of $262-$270 million. Adjusted earnings per diluted share guidance for the full year has also been updated to $2.30-$2.40 from $2.22-$2.36.
“We are well positioned to achieve our 2023 goals of high-single digit growth and strong margin expansion,” stated Matt Trerotola, Chief Executive Officer of Enovis. “We made a significant move to accelerate our growth and margin profile with the pending acquisition of LimaCorporate and are excited by our operational momentum and the strength of our R&D pipeline.”